Horizon Pipeline Company, L.L.C.

Original Volume No. 1

Effective Date: 04/18/2002, Docket: CP00-129-001, Status: Effective

Original Sheet No. 133 Original Sheet No. 133 : Effective

GENERAL TERMS AND CONDITIONS

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7.12 OPERATIONAL BALANCING

Horizon agrees that, if requested by Shipper, it will

negotiate with an entity that operates the facilities

interconnecting with Horizon at a Receipt Point (Balance Operator)

in a good faith effort to reach an agreement to deal with

imbalances at the Receipt Points specified (which would be a form

of a Predetermined Allocation), subject to the following

conditions:

(a) Such agreement must set out a mutually agreeable

procedure for dealing, as between Horizon and Balance Operator,

with any difference between confirmed nominations and actual

physical gas flow caused by operational conditions, so that any

such discrepancy does not affect any Shipper;

(b) The Balance Operator must meet the same

creditworthiness standards as Shipper;

previously entered into such agreement which was terminated because

of Balance Operator's failure to perform. Nothing herein is

intended to restrict Horizon's right to terminate in accordance

with its terms any agreement entered into hereunder, including

without limitation the right to terminate for Balance Operator's

failure to perform consistent with its obligations under the

agreement.

7.13 CENTRAL DELIVERY POINTS

(a) Contained in Horizon's Catalog of Points are

points which Horizon has designated as "Central Delivery Points"

(CDPs). A CDP is composed of all the interconnections between

Horizon and an individual local distribution company (LDC) in a

specific Zone that are within close geographical proximity as

determined by Horizon with regard to the operational constraints of

its system. CDPs may also be developed for other entities or

groups on a case-by-case basis, subject to any requisite approvals

by affected LDCs. Shippers may nominate deliveries under both firm

and interruptible Agreements to a CDP in lieu of the individual

interconnections that make up the CDP. Except as described in

subsection (b) hereof, all deliveries to the individual Delivery

Points which make up the CDP will be aggregated together for

purposes of allocating deliveries among Shippers and Agreements

pursuant to Section 9 and determining whether Balancing Service or

Overrun Charges and penalties are applicable.